Based on forecasts of potential contracts, the CEO of Kibby and Strand is considering an option to lease the building next door, but he has concerns there may be some slack in current production capacity that could be utilized, negating the need for the addition space. There are also some newer technology cutting and sewing machines available with higher capacity the company could purchase, but they are expensive. So here are the CEOs options:
- Do nothing to increase production, but the downside is lost contracts.
- Lease the building next door, then expand production by purchasing the same technology cutting and sewing machines as the company has now.
- Try to squeeze more production out of the current production department setup. This may require overtime pay, and would definitely increase the maintenance costs on the current machines.
- Replace all the machines in production with newer higher capacity machines and remain in the current production space.
How do you decide which option to select without reliable and valid data on the current production department? You can’t, and that is the CEO’s dilemma.
This scenario presents a realistic picture of how outcomes data can serve as a catalyst for change within an organization. While the focus of this case is on consumer satisfaction data, most firms have ready access to a dearth of outcomes data that can be used to investigate causal factors, establish priorities, weight options (alternatives), support decisions, and provide an internal benchmark from which to compare future results. Making operational and supply chain management decisions without having benefit of information coming from sound statistical analyses, is tantamount to playing darts blindfolded and betting your life savings on hitting a bull’s eye on the first toss. Industries are being increasingly more reliant on data to support the decision-making process. Data analytics and informatics permit leaders to leverage big data, perhaps in ways it hasn’t been previously used, to make informed decisions that can positively impact clinical outcomes, financial and operational performance, and the strategic